At dealerships, car shoppers can often apply for in-house financing. It certainly seems like a more convenient option than shopping around with different lenders. But what does it really mean when a dealer offers you financing, and how is it better than outside financing options?

What Is In-House Financing?

If a dealer advertises financing, what you’re getting is a loan. There’s a low risk with nonpayment, as the loan is secured by your vehicle.

You’ll make regular payments and interest will be applied to the principal. If for some reason you can’t make the payments, the dealership can repossess the car. Defaulting on payments will also hurt your credit rating.

How to Get Financed for a Car?

First, start by checking your credit report. If your credit rating is low or you lack a credit history, securing a loan with a traditional lender may be difficult. Dealerships are way more flexible in this area. Getting financed at a bank or some other dealerships require financial documents that show your income. Luckily, at Hawthorne Auto Square, getting financed for a car does not include checking your credit or source of income.

Applying for and securing a loan from a dealership is typically faster. If you’re working with an outside lender, you’ll need to get pre-approved first. Even if you’re considered a “high-risk” applicant, allowing a dealer to finance your vehicle may let you drive away much sooner (sometimes days ahead of schedule) in the new or used car you’ve been looking for.

Benefits of Getting Financing for a Car

Here are a few benefits of accepting a loan from your dealership rather than a third-party lender:

  • Flexibility: In addition to a faster process, financing options provided by your dealer may come with flexible interest rates and extended warranties.
  • Get a car you can afford: Dealerships with in-house financing options often run them before bringing you to the showroom. Therefore, you already have a loan when you start shopping and are shown only the vehicles that fit your budget. Some incentives may even be thrown in during the process.
  • Easier qualification process: There’s more flexibility for people with fair to poor credit. While lower interest rates aren’t guaranteed, you might be able to refinance the loan later. If you make your monthly payments on time and in full, refinancing might be possible in about a year.
  • Build up your credit: Obtaining financing through a car dealership can boost your credit score. You may see this jump after a month or two. By improving your credit score, you can later find it easier to obtain a mortgage loan (and get lower interest rates), or be accepted if opting to rent a property.

Get Financing for Used Cars in Hawthorne Today

Hawthorne Auto Square offers in-house financing programs and accepts disability, Social Security, government assistance, and any other form of income. Our aggressive financing options enable customers to get into the used car they want—quickly. Plus, our Buy Here Pay Here policy also includes low APRs, and you can take five months to build your down payment. Contact us today for more information or call our sales team at 866-707-7664, or feel free to visit our Hawthorne dealership in person.